Add-On Interest Rate Converted To Apr - HP 12c Solutions Handbook

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Add-On Interest Rate Converted to APR

An add-on interest rate determines what portion of the principal will be
added on for repayment of a loan. This sum is then divided by the number
of months in a loan to determine the monthly payment. For example, a
10% add-on rate for 36 months on $3000 means add one-tenth of $3000
for 3 years (300 x 3) - usually called the "finance charge" - for a total of
$3900. The monthly payment is $3900/36.
This keystroke procedure converts an add-on interest rate to a annual
percentage rate when the add-on rate and number of months are known.
1. Press
2. Key in the number of months in loan and press
.
3. Key in the add-on rate and press
4. Key in the amount of the loan and press
received; negative for cash paid out.)
5. Press
6. Press
55,000.00
2,750.00
7,750.00
50,000.00
1,500.00
6,500.00
25,000.00
1,250.00
6,250.00
20,000.00
and press
12 to obtain the APR.
Remaining balance.
Second payment's interest.
Total second payment.
Remaining balance after the first
year.
Seventh payment's interest.
Total seventh payment.
Remaining balance.
Eighth payment's interest.
Total eighth payment.
Remaining balance after fourth
year.
CLEAR .
.
* (*Positive for cash
.
21
.